Correlation Between Jb Financial and NICE Information
Can any of the company-specific risk be diversified away by investing in both Jb Financial and NICE Information at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Jb Financial and NICE Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jb Financial and NICE Information Service, you can compare the effects of market volatilities on Jb Financial and NICE Information and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Jb Financial with a short position of NICE Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jb Financial and NICE Information.
Diversification Opportunities for Jb Financial and NICE Information
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between 175330 and NICE is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Jb Financial and NICE Information Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NICE Information Service and Jb Financial is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Jb Financial are associated (or correlated) with NICE Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NICE Information Service has no effect on the direction of Jb Financial i.e., Jb Financial and NICE Information go up and down completely randomly.
Pair Corralation between Jb Financial and NICE Information
Assuming the 90 days trading horizon Jb Financial is expected to generate 1.18 times more return on investment than NICE Information. However, Jb Financial is 1.18 times more volatile than NICE Information Service. It trades about 0.11 of its potential returns per unit of risk. NICE Information Service is currently generating about 0.05 per unit of risk. If you would invest 1,134,440 in Jb Financial on October 29, 2024 and sell it today you would earn a total of 802,560 from holding Jb Financial or generate 70.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jb Financial vs. NICE Information Service
Performance |
| Timeline |
| Jb Financial |
| NICE Information Service |
Jb Financial and NICE Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jb Financial and NICE Information
The main advantage of trading using opposite Jb Financial and NICE Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jb Financial position performs unexpectedly, NICE Information can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in NICE Information will offset losses from the drop in NICE Information's long position.| Jb Financial vs. Sungmoon Electronics Co | Jb Financial vs. PJ Electronics Co | Jb Financial vs. SungMoon Electronics Co | Jb Financial vs. DB Insurance Co |
| NICE Information vs. Samsung Electronics Co | NICE Information vs. Samsung Electronics Co | NICE Information vs. KB Financial Group | NICE Information vs. Shinhan Financial Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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